Security with a Vengeance

Safety and security rank high among human values, and rightly so. To risk one’s life in reckless fashion shows a foolish disregard for self and dependents. Behav­ior that diminishes or threatens the lives of other peaceful persons is deemed irresponsible and anti­social. The case for various safety measures and security regulations would seem self-evident. But "playing safe" also may have dis­advantages that ought to be con­sidered. Lives can be wasted, if not snuffed out entirely, in the at­tempt to be safe and secure.

Safety and security alone will not sustain life. They may en­hance food and shelter but afford no nourishment or covering as such. Nor are they tools of produc­tion that enable a worker to in­crease the product of his labor. Americans in the latter half of the twentieth century enjoy safety and security in large measure. But the high level of living to which we have grown accustomed is largely attributable to two other factors: (1) Approximate­ly half of the 200 million people in the United States work to earn a living for themselves and the other half; and (2) An average of roughly $20,000 has been saved and invested in productive capital for each such job opportunity. Without such savings and capital investment per worker, famine would be as common in America as in any backward area. Our job opportunities — our very lives—de­pend upon our tools of production.

So, every additional $20,000 saved and productively invested makes possible an acceptable level of living for two — one worker and one dependent. To take from a man the tools of his trade is to deprive two lives of their economic means of support. And it is a harsh fact that funds diverted to security programs cannot at the same time provide the tools of production and trade. Safety meas­ures, however well-intended, have costs that always must be counted.

Consider, for example, the pro­posed expansion of the Federal Social Security program to a tax of 10 per cent on the first $10,800 of a worker’s annual earnings. Now, $1,080 saved per year and reasonably invested would build into a $20,000 job opportunity in about 14 years. And $1,080 added annually over a period of 40 years would cover 5 or 6 such lifetime job opportunities. Any savings bank or life insurance agent can verify that fact.

This is not to say that every worker would save and invest $1,080 a year if he (and his em­ployer) were not compelled to pay it as social security taxes. Many a worker doubtless would choose to consume rather than save any such addition to his take-home pay. But clearly, the money paid as taxes is neither saved nor in­vested in productive job opportuni­ties. It is currently consumed. The $20 billion transferred coercively from producers to consumers through the social security account in fiscal 1966 withdrew from the American economy potential in­vestment funds equal to one mil­lion job opportunities. A million lifetime job opportunities pre­cluded by just one year of com­pulsory social security! And 1967 is the 31st year of social security tax collection in the United States.

Another security measure of some import concerns the military defense of the United States of America. The total Defense Bud­get for fiscal 1968 calls for ex­penditure of $73 billion. Whether such spending is adequate or prac­tical or necessary or desirable is not in question here. But $73 bil­lion is equivalent to the capital re­quirement for 3,650,000 lifetime job opportunities. And please do not mistake that fact. It does not mean that defense spending in 1967-68 will create 3,650,000 life­time job opportunities. What it means is that funds, which might otherwise have been invested in the tools of peaceful production and trade, will be consumed that year in the name of national de­fense.

More specifically, the Vietnam part of our national defense cur­rently is costing American tax­payers at the rate of $24 billion a year. Tragically, 6,400 American lives had been lost in Vietnam through 1966. And it is estimated that 5,000 more Americans will have been killed in action by the end of 1967, with more than 60,000 wounded.’ Heartbreaking enough are the casualty lists of individu­als killed or maimed on the battle­fields. But their numbers scarcely begin to measure the costs of the Vietnam security action. The $24 billion to be consumed for that purpose by the United States this year is equivalent to the capital investment for 1,200,000 lifetime job opportunities. That makes a civilian casualty list approximate­ly forty times the number of Americans killed and wounded on the battlefield.

Highway and automobile safety programs are much in the news nowadays. The 50,000 deaths a year attributable to motor vehicle accidents in the United States many times exceed the number of Americans killed in Vietnam. But those who urge the expenditure of billions of dollars for various high­way and auto safety features ought to understand that each billion so expended is equivalent to the capital requirement for 50,­000 lifetime job opportunities. For every $20,000 in extra safety fea­tures the law forces General Mo­tors to add to perfectly good cars, that same law in effect withdraws one lifetime job opportunity from the American market.

The pollution of air and water is a growing threat to American lives. Recent estimates suggest that $300 billion will be committed to that war over the next 30 years. And whether that will be too much, too little, or too late is any­one’s guess. But it is reasonably certain that the billions of dollars to be spent annually by businesses and by governments for air and water purification cannot simul­taneously be used to provide tools for productive employment. Clean air to breathe and pure water to drink are important. But they are not food or shelter or all of the other things also vital to life. And $300 billion equals the capital re­quirement for 15,000,000 lifetime job opportunities.

If we spend enough for such measures, perhaps we can be guaranteed a ripe old age, protect­ed by medicare, defended against communism and automobiles, filled with fresh air and water, safe and secure. But will the productive workers of that happy day still deem the rest of us worth feeding and housing and caring for?

It behooves us to consider that other side of our various security measures. The lives we save by such measures may indeed be our own; but also, the lives saved may be more than offset by the num­bers of workers and their depend­ents thereby denied the tools of peaceful production and trade. And our own job may be one of those at stake, jobs and lives fore­shortened in the name of security. These, too, are among the fatali­ties of our time — the often unseen fatalities of good intentions and security with a vengeance.

THE FREEMAN

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December 2014

Unfortunately, educating people about phenomena that are counterintuitive, not-so-easy to remember, and suggest our individual lack of human control (for starters) can seem like an uphill battle in the war of ideas. So we sally forth into a kind of wilderness, an economic fairyland. We are myth busters in a world where people crave myths more than reality. Why do they so readily embrace untruth? Primarily because the immediate costs of doing so are so low and the psychic benefits are so high.